Social Security: Is it so successful we take it for granted?

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Frances Perkins, shown greeting President Franklin D. Roosevelt upon his return from the 1943 Tehran Conference, was a major designer of the ground-breaking Social Security program.

Without Social Security, life for America’s elderly in would be drastically different.

From a Congressional Research Report for Congress [PDF] dated April 2008: “Social Security has significantly reduced elderly poverty. The elderly poverty rate has fallen from 35% in 1959 to an all-time low of 9% in 2006, in large part because of Social Security. If Social Security benefits did not exist, an estimated 44% (of) the elderly would be poor today assuming no changes in behavior.”

So, maybe it’s complacency towards the social insurance program started during the Great Depression that helps explain the dearth of stories for the Social Security Stories Project being conducted by the Frances Perkins Center in Newcastle, Maine, a non-profit named after the first woman to serve in the U.S. Cabinet, and a major designer of the ground-breaking Social Security program.

Maybe it’s because people don’t stop to think what their lives would be without that monthly Social Security check.

Or maybe it’s natural reticence that’s made people hesitate to share their Social Security experience.

“We know how personal these stories are and understand why some people may be hesitant to share their stories,” said Barbara Burt, executive director of the Frances Perkins Center in an email. Stories can be submitted anonymously, she said. What’s important is “to help us spread the word about how Social Security has changed millions of Americans’ lives and is still going strong, and we still believe the best way to do that is through their own stories in their own words.”

Stories from young and oldBegun the end of May, the project goal is 1,000 personal tales about how Social Security matters to young and old beneficiaries by July 31: stories told in 400 words or less or in about three minutes of video. To share your experience, or that of a family member or friend, go here.

So far, there are only 35, though potential storytellers abound. According to the Social Security Administration, 1 in 7, or more than 50 million people receive benefits.

Personal stories demonstrate the value to society of the program signed into law 75 years ago this August by President Franklin D. Roosevelt, says Maya Rockeymoore, a board member of the National Committee to Preserve Social Security and Medicare and a supporter of the story project.

“Social Security,” she said “is the bedrock of the American social contract. It provides the basic support, the insurance working families need in order to be protected in loss of life of a breadwinner, in the case of disability and in the case of old age — outliving your paycheck, essentially.

socialsecurity.gov

First meeting of the Social Security Board, Sept. 14, 1935. Left to right: Arthur J. Altmeyer, Chairman John G. Winant and Vincent M. Miles.

“It’s important that people are aware that their next door neighbors [and] people across the street are heavily reliant on Social Security.”

Too often, she said, people take the program for granted “because the program is so successful it seems almost seamless.”

The stories put faces on Social Security, Rockeymoore said.

One family’s storyLike the face of Evonne Zalewski, of the suburban Milwaukee, Wis., town of Greendale.

Zalewski’s father died young from lung cancer, leaving her 42-year-old mother mortgage payments, hospital bills and two children to support.

“The funeral director in our small town [Cedarburg, Wis.] told my Mom about benefits available from Social Security that would help her. I remember my Mom telling me how this would help so much and that we will not be poor or have to move. Having grown up during the Depression with only food stamps available was terrifying for my Mom,” Zalewski wrote.

Later, Zalewski used Social Security benefits to help pay her way through nursing school. “This benefit opened the door to my future and I have had a wonderful career over the past 41 years,” she wrote.

“I am not the only one that was on the receiving end of this benefit,” she said, talking about the many children and adults she cared for through the years and her collaboration with health care professionals to improve the health care system.

Recently, she was laid off from a job investigating Medicare and Medicaid fraud.

Though 62 and eligible to draw her own Social Security check, Zalewski says she’s regrouping after the job loss and her mother’s death, before going back to work. “I’m looking to do some consulting and continue to give back.”

Zalewski’s story is posted on the center’s website, as other stories will be, with some included in a future book of essays by leading Social Security experts, historians and policymakers.

The project, including the book, is funded in part by a $35,000 grant from the Ford Foundation through the National Academy of Social Insurance.

On the pages of that book, perhaps in a footnote, you may meet Vermont school teacher Ida May Fuller, the first American to receive a Social Security check [PDF] on Jan. 31, 1940. She received $22.54.

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Comments (25)

I think stories such are this as shared at many family functions and at corner cafes. I think the problem lies more with media elites or dependence on group think tanks which are often anti small d democratic. I remember seeing the weight fall off my father’s shoulders as he was able to retire from a demanding profession and take a lower paying job which he did from age 64 to 70.

My father died of a heart attack at age 54 leaving
six children. One son in the Navy,four in grade school and myself a senior in high school. Thanks to Old Age and Survivors Insurance (OASI) my mother was able to tell me to take the freshman
scholarship the U. of M. offered me and “don’t worry about us.” No wonder I fail to applaud when
right wingers scream socialism.

I think we should privatize social security. Before you liberals start your usual name calling lets compare the two plans
Social security – I have paid into social security for more than fourty years.
I recently was informed that at age 65 I would get $1700 a month until I die.
Presently social security is in the red and may not be around when I am 65.

Private 401k – about 15 years ago I started a 401k savings plan. I put 3% of my pay with a matching from my company. Even with the ups and downs of the stock market, I have over $200,000 in my account. This is my money a when I die it will be go to my wife and daughter. If I could have started my 401 when I was young instead of paying into social security I think I would probably have almost a $1,000,000 today.

What would you rather have a $1,000,000 in the bank or get $1700 a month until you die with nothing for your wife and daughter.

I agree with what’s said in the article and acknowledge it’s impossible to get the whole Social Security story included. The point made that Social Security has been enormously helpful to individuals and society as a whole over these past years is irrefutable. However, the media focus now is on the economics for the future, a critical topic. The personal stories are needed to put human faces on statistics. But – big but – the numbers don’t work. Why doesn’t anyone talk about means testing? Oh, I know – it’s political dynamite. We have to channel the money available to those who need it for basic living expenses and deny it to those who don’t. Maybe a sliding fee scale? It’s not economic justice when our young people’s money is transferred to those who don’t need it. FYI – I’m a Liberal. Really.

Social security only works because EVERYONE is in the pool. It would prohibitively expensive to try to weed out those who don’t need it. The cost decreases with more who contribute.
One reason social security is going broke is that in the past it has been a money pot and all kinds of agencies have borrowed money from it.
A simple fix for social security going broke–and I don’t believe it ever will–is to raise the limit on earnings, when SS withdrawals stop. Right now it’s about $100,000. It would be ridiculously easy (if it weren’t for politics) to extend that limit even a little, which would make it more solvent.
Good for you Granneman, but most people have neither the extra funds or the sophistication or ability to invest wisely. And even those of us who do, the returns on investments have plummeted in recent years. You cannot count on the stock market. You can count on social security. And it will not run out. I guarantee it.

Stories like that of Evonne Zalewski need to be used to illustrate that Social Security is not a retirement plan, it’s a safety net.

People like David Granneman weren’t supposed to be ignoring retirement saving in their early years & expecting to rely on social security – they were supposed to be saving on their own as well. Fortunately for him, he eventually started saving & now has a nest egg of his own to live more comfortably in retirement than if he hadn’t.

Also, Dan, as I understand it, there are survivor benefits from social security for your spouse. If your daughter is an adult when you die, she won’t get benefits; but if she’s a minor now & you die today, she’ll get SS benefits – like Evonne Zalewski did. On the annual statement I get from the SSA there are estimates for what I’ll eventually collect if I keep working & estimates for what my spouse and dependents would collect if I were to go today. Yep, they’d get the nest egg I’m working on through IRA & 401k accounts too & not rely solely on SS. That seems like the way it should be – a safety net that keeps people from living on the street, should tragedy strike or they become unable to work in their elder years. But if you want to enjoy the same quality of life as during your working years, it is prudent to save on your own & not rely soley on SS benefits for retirement.

If there has been a failing in Social Security, perhaps it has been in marketing – and not making it abundantly clear that people should still be saving during their working years & contributing to their own retirement funds in addition to SS.

Social Security is a failed system. Any honest person knows this. I am not saying no “good” has resulted from this failed system.

It is constantly manipulated by the politicians in order to buy votes and scare voters into resisting real “change.” Many younger workers now realize that this failed system will not deliver the “hope” that was promised.

David Granneman is absolutely correct in his analysis, but we needn’t even go to the stock market to outperform SSI’s payback. Any passbook savings account pays more interest than SSI.

The argument that SSI has lowered the percentage of elderly is specious on its face as can be seen with the authors of the Congressional Research Report covering their butts with the “assuming no changes in behavior” caveat.

Removing the false promise of a comfortable retirement that too many people live under would inherently change the behaviors of all but the most irresponsible citizens.

And indeed, in the final analysis it is the most irresponsible that are always the greatest benefactors of socialism.

SSI, like all socialist constructs, drags “EVERYONE in the pool” down to the level of those dependent on water wings.

Oh, did social security quit sending out checks? What else would a failed system mean? Actually, economists and politicians (except for the rightwing ones) have long lauded social security as a simple program that works. All we need to do now is lift the limits on contributions–it would affect only the wealthiest.

The scare talk about Social Security going broke is a fiction created by those who wish to kill it and make workers create private accounts that could shrink greatly or disappear in years when there are stock market crashes or, most recently, the housing crash and banking crisis. It is not designed to be a wealth creator, but a SAFE savings account.

While the lie about Social Security is repeated ad nauseum, those telling the truth are not often quoted in the media. And the truth is that its trust fund contains enough money — received from workers — to pay all benefits in full for several decades, after which benefits will be partial unless we act soon to increase the fund. All Congress has to do is to remove the cap from the current $100,000 or so in wages that are currently subject to the Social Security/Medicare payroll deduction. This would mean that Bill Gates and other high earners would pay the tax on their annual millions. (Or they could just raise the cap enough to cover future needs, as was done in 1983 to prepare for baby boomer retirements.)

Social Security is not just a retirement savings account. It is three things: at least partial protection against dire poverty in old age; support for surviving spouses and children of workers who die before retirement age (more children that now are on Medicaid); and support for workers who become disabled before retirement (one in seven).

In 2008, 80,645 Minnesotans from the three above categories received a total of $40,135,000. Of this amount, $12,152,000 went to recipients in Hennepin County and $7,511,000 to Ramsey County, most of whom would not only be without income but without the insurance Medicare provides. It is a precious resource to be protected by Congress no matter what.

Thomas Swift write
“Removing the false promise of a comfortable retirement that too many people live under would inherently change the behaviors of all but the most irresponsible citizens.”

Such wild claims further the public’s misunderstanding of Social Security as a retirement program, which it is not.

But if we’re going with anecdotal claims, I’ll offer my own. For essentially my entire lifetime, my generation has lived under the assumption that social security would not be available by the time we retire. Yet the data show that our generation is behaving similar to or worse than the generations that have gone before: we’re not saving for retirement & we’re living beyond our means. Therefore, the claim that eliminating social security would change behavior is demonstrably false.

One of the problems with privatizing social insurance schemes is that these schemes are as much about insuring that pensioners do not become a burden on the state as they are about providing a sufficient income during retirement. Can we honestly say that if the market were to crash, the government wouldn’t come up with the money to bail-out retirees? Even during good economics times we’d probably end up having to bail out those whose investments went south – we’re not about to kick our retirees out on the streets. Meanwhile, those whose investments did well would be allowed to keep their gains. Basically you’d have a situation where gains would be privatized, but losses socialized – do we really need more of that?

Also, this may be slightly off-topic, but proponents of privatization need to stop making the dishonest argument that the government is just borrowing from itself – that the social security trust fund is nothing but “worthless” paper. Whatever truth there is to this argument, it is overshadowed by the fact that privatizing social security would merely require the government to issue an equal amount of debt to private investors to cover deficits. This dishonesty is made all the more acute by the oft-accompanying claims that we shouldn’t raise taxes or cut any specific government programs – the only concrete steps that actually would affect total government debt (sadly the non-specific government spending everyone agrees should be cut doesn’t really exist).

Somehow though, the fact that privatization would bring no net improvement to government finances was almost completely absent from the debate. Curiously enough, even the political left seemed to focus more on the trust-fund bonds as sacred government promises, ignoring the fact that without the trust-fund we’d simply be in debt to someone else to the tune of several trillion dollars. It makes one question the quality of news coverage in this country – when nobody seems to understand basic accounting (in defense of our previous president’s integrity, I honestly don’t think he understood the accounting).

If you want to make “real” improvements to the government’s fiscal picture, you can’t do it by privatizing social security. The only solution that works is to shrink deficits, through some combination of higher taxes, lower spending, and improved economic growth.

The Republicans ought to thank their lucky stars that not a shred of their Social Security privatization was in place. The meltdown would have been a real Herbert Hoover moment.

We just need to accept certain funding priorities and the need for cuts.

If we raise the retirement age to 70 and index benefits to inflation instead of wages, force those earning more than $250,000 to accept fewer benefits (unfair but inevitable), and slightly increase the payroll tax, social security will be fine.

If we charge higher premiums to wealthier Medicare beneficiaries and institute a hard cap on how much care Medicare will pay for (allowing people to buy private insurance if they want to receive more care), Medicare will be fine.

As for defined-contribution social insurance schemes, with the second stock market collapse in a decade followed by a recovery that has still only brought the S&P 500 to its level of 11 years ago without factoring in inflation, as well as collapses in every other kind of asset besides commodities, and bargain-basement bond returns…why exactly is investing our Social Security funds supposed to be such a good idea again?

People forget that if you were a working adult in 1929 and anywhere close to 65, even if you had saved money in a bank, you stood a good chance of having had your savings wiped out. Social Security spared many millions of people from abject destitution. So it continues today when many people’s pensions and savings have been decimated by unfunded pensions, the stock market or other causes. Just like with the foreclosure crisis, hard times don’t just affect the “working poor” although it hits them the hardest.
How ridiculous it is to see people trashing this program for being a “failed system”.

And for people who compare how much money they would have if they’d started a 401 K when they were younger? Nobody and especially not Social Security stopped you from saving when you were 25 years old. We know from experience that 25 year old people don’t believe they will ever grow old!

Ron why do you ignore what you know to be true? Taxing for social security on incomes over a certain amount would only be fair if you like a flat tax. Also minor means testing could also solve some problems. The press used to enjoy publishing articles on selfless individuals who could turn down or return their social security.

hello jon
maybe as parents we owe it to our children to educate them regarding THEIR retirement. i told my daughter that if she wants to be comfortable when she gets older that she needs to save for her retirement. i told her to start a 401k as soon as she was able when she started her first job. LUCKELY THIS IS ONE OF THE FEW TIMES SHE LISTENED TO MY ADVISE.

Means testing? No – if people feel guilty about receiving what they have earned, they can donate their checks to charity. Means testing would be part of a move toward privatization and is often recommended by conservatives who would like that to happen.

Saving for retirement? Yes – Social Security was not meant to be a person’s entire retirement income, but rather a bottom-line protection from dire poverty in old age, from disability, and from the loss of a family’s breadwinner. It is an insurance policy, but the more you can save in 401Ks or other plans, the better your retirement.

Private accounts? No-No-No. The right-wing pushers of private accounts talk only about earning so much more (not true if you retire in a bad year), but never mention that a lot of your Social Security contributions will go to the financial services companies managing your account.

Ron G (#15). No, it does not prove that Social Security is a failing system because it isn’t.

The government conducts period reviews to see if current levels of funding will cover all payments for the next 75 years. If not, as in 1983 (when Reagan increased payroll contributions) and now, revenue must be increased in order to meet shortages that will occur SEVERAL DECADES FROM NOW.

When George Bush started the “crisis” disinformation, he was talking about a $12 billion shortfall that would not take place for somewhere between 30 and 50 years. All such warnings about the system are efforts to kill the country’s finest social safety net and replace it with private accounts.

Interesting discussion but I can’t tell what’s true and what’s the best recommendation. If we could squeeze the politics out, then use some creative problem solving and truth telling by people who have the facts (and fact checkers), we might make some sense. The only way I can think of having this happen is a citizens’ movement to hold Congress and the President accountable.

And your answer always seems to be that government should provide social services for the poor and elderly and disabled, education, police and fire and military protection, infrastructure and its maintenance, management of resources, record-keeping (property, drivers’ and occupational licensing, revenue and spending and much more, parks and recreation and open space — and a thousand other necessities — on a ever-shrinking amount of revenue.

I believe it was Louis Brandeis who said, “Taxes are the price we pay for civilization.” We could easily lose our civilization — one of opportunity and equality and scientific invention and artistic creation — if we fail to honor and maintain it. Gotta have revenue to do that.

Saving for retirement is well and good, but what about the people I know who have lost jobs after the age of 50 and have never again found full time work?

I started seeing this situation in the 1990s, during supposedly good times, where people went through their savings, sold their houses, sold their cars, and finally, reluctantly, cashed in their 401(k) accounts, just so they could hang on till they were eligible for Social Security. This happened to three people I knew–in the 1990s. They were qualified people who had worked all their lives and had good work records, and each of them applied for every job that came along in their field anywhere in the country, but they ran into what they saw as a wall of age discrimination.

If anything, the situation is worse now. That’s why the proposals to raise eligibility for full benefits to age 70 is so repugnant. It’s completely unreasonable for anyone who does physical labor, and even a person who might be content to stay at a desk job till age 70 may find himself or herself on the employment scrap heap.

If you’re young and inexperienced, or if you’ve been very lucky and insulated from reality, it’s easy to pontificate and say that everyone should save for all their needs during retirement. Unfortunately, reality has a way of interfering with Milton Friedman’s ideology.

Let’s raise the cap on FICA assessments and be done with it. Meanwhile, anyone who wails “needing” to cut Social Security because of the Federal deficit and yet supports the wars in Iraq and Afghanistan ($250 million per day in Iraq alone) is a mean-spirited hypocrite.